KUALA LUMPUR (Nov 29): OldTown Bhd’s net profit increased 20% to RM15.21 million or 3.28 sen per share for the second quarter ended Sept 30, 2017 (2QFY18), from RM12.63 million or 2.8 sen per share in the previous year thanks to higher revenue from its manufacturing of beverages segment.

Revenue increased 15% to RM114.2 million from RM99.55 million a year ago.

The group announced an interim dividend of three sen per share in respect of financial year ending March 31, 2018 which is payable on Feb 2, 2018.

For the cumulative six months (1HFY18), the group’s net profit was up by 21% to RM31.98 million from RM26.51 million in the previous year. First half revenue was up 10% to RM223.5 million from RM202.43 million a year ago.

Commenting on its prospects for the financial year, OldTown said weak consumer sentiments as well as tightened government regulations will impact the food & beverage (F&B) industry and create a tougher business environment.

Nonetheless the group remains focused on driving and strengthening the value perception of its product amongst current users of the brand.

It will also continue to adopt a growth strategy of opening new outlets centred on its traditional “generic” themed outlet.

“We will also be steadfast in identifying potential locations where the lower cost model (known as OldTown White Coffee Basic) remains as a viable solution and a growth model,” said Old Town in a bourse filing today.

On the manufacturing of beverages, the group is expecting stronger growth from exports of products to China, Australia, USA, Indonesia and Philippines. As for the domestic market, focus will be placed on introducing distributors’ performance management programme, capturing online channel opportunities and improving outlet execution, it said.

As at Sept 30, the group has a total of 232 cafe outlets — 189 in Malaysia, nine in Singapore, 27 in Indonesia, one in Australia, three in China, one in Hong Kong and two in Myanmar.

OldTown shares closed down seven sen or 2.8% today at RM2.43, bringing a market capitalisation of RM1.14 billion.